Potamianos v Prescott & Anor [2020] EWHC 3465 (Ch)

“An evaluation of all the circumstances surrounding the offers shows that none of them rendered Dr Potamianos’ exclusion from the Company fair. They could not be relied on to defeat Dr Potamianos’ petition and it would make no difference to that conclusion that an expert might now value the shares as at the time the offers were made at less than the £1.34 million or £1 million offered …We do not think that the expert evidence of valuation, whatever its result, will be capable of producing a result that would deny Dr Potamianos any relief upon his petition. That is not to say that the offers made may not have some bearing upon costs questions, depending upon the outcome.”

“We would add that in each party’s skeleton argument for this appeal he ‘puts his best foot forward’ in identifying the features of the case upon which he relies to put the other in the worst possible light: see e.g. paragraph 11 of the argument for Mr Prescott and paragraph 5(5) of Dr Potamianos’s argument. In our judgment, such paragraphs only serve to support the judge’s overall conclusion that fault lay on both sides.”

“Although both sections 210 and 75 are silent on the point, it is axiomatic that a price fixed by the court must be fair. While that which is fair may often be generally predicated in regard to matters of common occurrence, it can never be conclusively judged in regard to a particular case until the facts are known.”

“the first and fundamental principle of valuation; namely that things are to be taken as they are in reality on the valuation date, except to the extent that the exercise requires a departure from reality. In the old cases this is summarised in the Latin phrase rebus sic stantibus. In the more modern cases it has been described as the principle of reality.”

“Standing back therefore, the putative market for this shareholding in July 2009 would have been offered a 26% minority holding in an apparently incompetently managed Indian company, the majority shareholders of which were close-knit private individuals with no reason to take any notice of the purchaser’s views about the conduct of the company’s affairs, with a track record of mismanagement, or nonmanagement, of its principal asset which they had allowed to become dormant, in a deteriorating political and economic environment in the DRC, and who had allowed a winding up petition to be presented and served, with the immediate consequence of prohibiting the completion of any share sale transaction in any event. The interested purchaser would have discovered, upon due diligence, that the supposedly valuable rights in the JVA were still inchoate as the result of the outstanding presidential decree, that attempts to fund the project had come to nothing, and apparently ceased a year previously, that the company lacked its own resources with which either to fund the project or to deal with its creditors, and that the commercial substratum upon which the JVA had been constructed, namely an immediate local demand in the DRC for bitumen needed in a large government roadbuilding programme, had in all probability evaporated due to the deterioration in the political and economic state of that country.”

“I think that Mr Prescott did his best to give honest answers to all the questions put to him. However, he was highly invested in the outcome of this inquiry and I cannot exclude the possibility that his recollection of some of the events covered may have adapted over time to be consistent with SEL’s claim to damages. I think that the assumptions Mr Prescott made in support of his quantification of the loss suffered by SEL were astonishingly over-optimistic. I have little confidence in them as I will explain below. I have the impression that Mr Prescott was given free rein to devise those assumptions as he saw fit without much if any critical scrutiny being applied to them before the trial.”

“… On the contrary, having heard and seen Mr Prescott give evidence, I have no doubt that he acted in what he believed to be the best interests of SEL (and SRL) throughout, and that he went to great lengths to try and maintain a working relationship with Dr Potamianos and to keep him on board, even though the two men had very different personalities and even though they had difficulties working together. In my judgment, these findings are also supported by the documents considered above.”

“In cases, like the present, which relate to events which happened over many years, in which feelings run high, and in which individuals have taken up entrenched positions in their written evidence by the time the case comes to trial, there are significant risks that witnesses may be honest but mistaken about what took place, and may give evidence about what they would like to think happened rather than what they can truly recollect. These factors make the appraisal of their evidence more difficult. At the end of the day, the best guide to the truth is often to be found not so much in the demeanour of the protagonists, or even concessions made in cross-examination, but in the contemporary documents and in an objective appraisal of the probabilities overall. These matters were discussed more fully in Gestmin SGPS SA v Credit Suisse (UK) Limited, Credit Suisse Securities (Europe) Limited[2013] EWHC 3560 (Comm)… For these reasons, I have thought it right to focus on the documentary materials, which are extensive in the present case, and to place less weight on the differing accounts and recollections of the witnesses, save where they appear uncontroversial, or objectively probable, or are supported by the contemporary documents. That does not mean that the reliability of the witnesses is of no consequence. Where it is significant, however, I consider that it is often safer to make findings with regard to specific instances, rather than to form a view as to overall reliability and then apply that finding to what may be disparate circumstances. I have made such findings as I consider appropriate below.”

“They depend on the evidence”

“… Dr Potamianos complains that Sameaim has continued to invoice SEL and to be paid by SEL while he and … BDL, have been shut out from doing so since disputes arose and, more particularly, he was excluded from management. Dr Potamianos asserts that this was in breach of a promise made by Mr Prescott on 15 July 2016 that Sameaim would stop invoicing SEL, and, in any event, that it has allowed Mr Prescott to extract monies from SEL in a way that is prejudicial to Dr Potamianos. In my judgment, the answer to this complaint is that Mr Prescott and SEL should be held to the bargain that was made with Dr Potamianos in or about 2007, to the effect that they would each invoice SEL and be paid by SEL in a manner that was proportional to their respective shareholdings. Accordingly, for every £6 that [Sameaim] has been paid which is not matched by a payment of £4 to BDL since relations broke down, I consider that BDL is entitled to be paid a balancing payment (save that (a) in so far as the payments that were made to [Sameaim] were used to pay Dr Fells, that element of those payments should be left out of account, and (b) I will hear submissions as to whether BDL is entitled to charge VAT in light of the fact that, in the events which have happened, BDL has not performed any services for SEL). That may seem like rough justice in light of the fact that BDL and Dr Potamianos have made no contribution to SEL since that time, but, as against that, it is relevant to have regard to my finding that Dr Potamianos was unfairly excluded from management, and to set this decision in the context of my determination of wider issues as to the valuation date and other terms of buy-out discussed below.”

“We accept that the judge, although rightly describing the mechanism adopted by the parties for extracting money from SEL as involving “an element of artifice”, did not go so far as to find that the arrangements were a sham. He recognised that BDL’s contractual right to receive payments was conditional on the provision of (or upon Dr Potamianos being ready and willing to provide) services to SEL. That was why the judge observed that his order requiring the Balancing Payments to be made might “seem like rough justice”

“(1) Interest is awarded to compensate claimants for being kept out of money which ought to have been paid to them rather than as compensation for damage done or to deprive defendants of profit they may have made from the use of the money. (2) This is a question to be approached broadly. The court will consider the position of persons with the claimants’ general attributes, but will not have regard to claimants’ particular attributes or any special position in which they may have been. (3) In relation to commercial claimants the general presumption will be that they would have borrowed less and so the court will have regard to the rate at which persons with the general attributes of the claimant could have borrowed. This is likely to be a percentage over base rate and may be higher for small businesses than for first class borrowers. (4) In relation to personal injury claimants the general presumption will be that the appropriate rate of interest is the investment rate. (5) Many claimants will not fall clearly into a category of those who would have borrowed or those who would have put money on deposit and a fair rate for them may often fall somewhere between those two rates.”

“A ‘broad brush’ is taken to determine what rate of interest is just and appropriate: it would be neither practical nor proportionate (even in a case involving as large sums as these) to attempt a minute assessment of what will precisely compensate the recipient. In particular, the courts do not have regard to the rate at which a particular recipient of compensation might have borrowed funds. This policy is adopted in order to control the extent of the inquiry to ascertain an appropriate rate: see the Banque Keyser Ullman case (cit sup). The court will, however, consider the general characteristics of the recipient in order to decide whether to assess interest at a rate that is higher or lower than is conventional. So, for example, inJauravAhmed[2002] EWCACiv210, Rix LJ awarded interest at base rate plus 3% to reflect that ‘small businessmen’ had been kept out of their money and in recognition of the ‘real cost of borrowing incurred by such a class of businessman’. Thus, the court will examine what has been called ‘a question of categorisation of the plaintiff in an objective sense’ (see the Banque Keyser Ullman case, cit sup), recognise relevant characteristics of the party who is awarded interest and reflect them when determining the fair and appropriate rate.”

“Damages and interest payable to the claimant pursuant to this inquiry 1. The claimant’s damages are assessed in the sum of £23,730. 2. Interest shall be paid by the defendants on such sum at 2% above base rate from 13 June 2016. The amount payable in respect of such interest is £2,578.44. Sums payable to the defendant pursuant to the September 2018 Order 3. Pursuant to the September 2018 Order the claimant shall pay the first defendant the sum of £18,000 (namely £15,000 + VAT) together with interest at a rate of 2% above base rate from 30 July 2016. 4. The amount payable in respect of such interest is £1,898.70. Balance to be paid 5. The defendants shall pay to the claimant the amount due pursuant to paragraphs 1 and 2 of this order, less the amount due to the first defendant pursuant to paragraphs 3 and 4 of this order. 6. Payment of such amount is stayed pending final order in respect of quantum and costs in case CR-2017-006788 (the “UPP case”). The defendants must pay the claimant interest on the difference between the sum payable under paragraph 1 of this order, less the sum payable under paragraph 3 of this order at 2% above base rate from the date of this order until such final order in the UPP case and thereafter at the judgment rate. Costs 7. The costs of the trial as to liability for this claim and the defendants’ counterclaim and the issue of whether interest should be paid on such costs and if so at what rate and for such period are reserved to the designated 3 judge in the UPP case (Mr Richard Spearman QC) to be determined by him when he considers the appropriate form of order following his judgment in the UPP case (or at such other time as he may direct). 8. The defendants shall pay the claimant the following costs (and shall not be entitled to their costs in respect of the following): (1) the claimant’s costs of and occasioned by and consequential to the defendants’ application to amend their points of defence made by application notice dated 25 February 2020; (2) the claimant’s costs of and occasioned by the defendants’ application to extend time for service of their schedule of costs following judgment on this inquiry as to damages made by application notice dated 11 June 2020. 9. There shall be no order as to costs in respect of the defendants’ application made by application notice dated 20 December 2019 to extend time for service of witness statements. 10. Otherwise, the claimant shall pay the defendants’ costs of the inquiry to the date of this order on the standard basis. 11. The costs referred to in paragraphs 8 and 10 are summarily assessed as follows: (1) Under paragraph 8: £6,871 (2) Under paragraph 10: £248,000 12. Accordingly, the claimant shall pay the defendants the sum of £241,129. Payment of such sum is stayed pending final order in respect of quantum and costs in the UPP case. 13. The claimant shall pay the defendants interest on their costs (up to a maximum of £241,129) at 2% above base rate from the date the defendants paid those costs to the date of payment. … Permission to appeal 18. The claimant is refused permission to appeal in respect of the court’s determination that the costs of this inquiry should not be reserved to Mr Richard Spearman QC for determination after he has handed down judgment on issues of quantum in the UPP case. 19. The claimant is refused permission to appeal in respect of issues of quantum in this inquiry as to damages.”

“3.14 For the purposes of identifying the notional replacement costs that would be taken into account by a willing buyer, I have relied upon the contemporaneous email exchanges between Mr Justin Levine and Mr Prescott and Dr Potamianos in March 2016, being the point in time at which Mr Levine was exploring the possibility of purchasing SEL. 3.15 It is my understanding that both the Petitioner and the First Respondent accept that Mr Levine, whom they had in engaged in 2015 to act as their corporate finance advisor to try and sell the Company, has a detailed knowledge of the industry in which SEL operates. As such, I consider that, notwithstanding an element of self-interest (which would apply in the case of any willing buyer), Mr Levine provides a reasonable proxy for the behaviour of a willing arm’s length buyer, including in relation to: i The evaluation of future EBITDA; and ii The replacement costs (including the requisite staff) that it would be considered appropriate to reflect in lieu of the management charges paid to Mr Prescott and Dr Potamianos in order to properly reflect the ongoing costs of generating the future EBITDA of SEL.” i The evaluation of future EBITDA; and ii The replacement costs (including the requisite staff) that it would be considered appropriate to reflect in lieu of the management charges paid to Mr Prescott and Dr Potamianos in order to properly reflect the ongoing costs of generating the future EBITDA of SEL.”

“I would say that an incoming buyer would be fairly keen to have a replacement for me on the technical front as well as the CEO front because I was multi-tasking. As we know, Sprint Electric did lots of jobs across various aspects of the business. When you are a shareholder, you have a different work motivation. You do all these things. If you are an employee, then you tend to be a bit more specialised and you do not have the motivation to work as hard as the shareholder might do.” (7) Mr Pavlovich further submitted that a new CEO would be able to undertake more work than Mr Prescott, who had been planning “to be more supportive and spend less time and move into retirement” but who “was not able to do that” and “had to resort to working intensively to solve the problems” which were “mainly caused by the fallout from the dispute”

“160 I find that in January and February 2016 Dr Potamianos was doing what he could to avoid SEL having access to the PL/X source code. 161 But I think it makes no difference… On 27 May 2016 Dr Gardiner found what is now agreed to be v.6.11 of the source code. On 2 June 2016 Dr Fells started work on v.6.11. 162 There seems to me to have been no good reason for the delay in finding v.6.11. In cross-examination Dr Gardiner did not provide a convincing answer to the suggestion that permission from the IT administrator to access Dr Potamianos’ partition could have been sought in January 2016. My impression is that there was no sense of urgency at SEL during the first part of 2016 in seeking to find v.6.11. 163 There was a meeting between Dr Gardiner and Dr Fells on 10 June 2016, in which they discussed the way forward for SEL now that they had what they (correctly) believed to be v.6.11 of the PL/X source code. Their discussion is evidenced by an exchange of emails between 11 and 13 June 2016 … 164 Despite the tone of the exchanges between Dr Gardiner and Dr Fells, Dr Fells answered to Dr Gardiner who, as between them, took the decisions on priorities and direction. 165 Three significant points emerge from their discussions. First, Dr Fells would not try to re-create the source code for v.6.13. Secondly, he would re-write the v.6.11 source code using C code, a high-level programming code. Thirdly, he would make improvements to v.6.11 along the way. 166 In cross-examination Dr Gardiner accepted that converting v.6.11 into C code was by itself going to involve a very substantial re-writing of v.6.11. He confirmed that no engineer other than Dr Fells was recruited to carry out the work on v.6.11. 167 Dr Gardiner said that it took Dr Fells until late 2016 just to compile the v.6.11 source code because he did not have access to the compiler that Dr Potamianos had used, namely C30. Dr Gardiner did not provide a convincing answer in cross-examination when it was pointed out that C30 was stored on SEL’s server and that it had been the only compiler used by SEL for several years. It seems to me likely that the time taken to compile was due to the decision in June to re-write v.6.11 so that, among other things, it could be compiled under MPLAB X and XC16 compiler. Alternatively, this is further evidence of a lack of urgency. 168 Dr Gardiner also said that they had doubts as to which version of PL/X they had, but in cross-examination accepted that it was now known to be v.6.11, i.e. the exact version released to Bardac in 2014. 169 Dr Fells compiled v.6.11 on 11 November 2016. Dr Gardiner said that it still did not work correctly, but after modification it was released for testing on 16 January 2017 as “v.6.11.01”. 170 On 16 March 2017 Dr Gardiner made a presentation to SEL entitled “Product Roadmap”

“I would not dream of challenging his opinions. He clearly knows more about this sector than I do, but I was doing a different exercise”. (2) Ms Hindson’s exercise, which involved looking at replacing resources in the historic years, overlooks the fact that a purchaser would be buying future profits. While historic EBITDA can be used to gauge the likely future profits, a buyer has to factor in the resources it would require to replicate matters going forward. (3) In his email of 14 March 2016, Mr Levine set out a breakdown of staff replacement costs that he considered necessary, to include a new CEO (at £150,000) and two new designers/engineers, namely a hardware designer to replace Mr Prescott and a software designer to replace Dr Potamianos. The principle of subtracting costs in respect of a CEO plus two designers/engineers was accepted by Mr Prescott and Dr Potamianos in their response, albeit that they argued that the initial costs of the designers should taper off in the later years. (4) Ms Hindson’s contention that a hardware designer/engineer at a cost of £60,000 p.a. was not necessary was based on being told by Dr Potamianos that Dr Gardiner was recruited as Mr Prescott’s successor “in his technical and managerial role” and that Mr Keen was recruited as a successor to Dr Potamianos “in his managerial role and would also fulfil a sales role” (§5.2.10 of her report). However, Mr Levine envisaged that Dr Gardiner and Mr Keen would retain their roles as JMDs and require assistance, and in particular that, in addition to a CEO and Dr Gardiner, a hardware designer would be required to replace Mr Prescott’s hardware skills. Mr Levine’s approach is a reliable guide to the approach of a notional buyer, because it is based on sound considerations. As he explained in his oral evidence, Mr Prescott possesses a unique knowledge and experience of all aspects of the hardware design of the entire product portfolio accumulated over SEL’s full history (mirroring Dr Potamianos’ knowledge of the source code); and Mr Prescott provided guidance to Mr Janicki and other SEL staff, who were not a replacement for him. While neither expert could assist on the market rate, both Dr Potamianos and Mr Prescott accepted that £60,000 p.a. would be a reasonable salary for a hardware designer when they reverted to Mr Levine with their figures in 2016. Further, SEL’s draft Business Plan identified a need for 4 additional technical employees in the context of its succession planning (including a hardware engineer with a salary of £45,000 p.a. for 2016-2018). (5) As to the software designer/engineer, it is common ground that such an individual is required, and the issue which divides the parties is whether £37,000 should be allowed based on the costs of Dr Fells or whether £60,000 should be allowed based on the reasonable cost of employing a full time software engineer. The figure of £60,000 is correct for the following principal reasons: (i) it is the figure applied by Mr Levine, (ii) it was accepted by Mr Prescott and Dr Potamianos as a reasonable figure in their response to Mr Levine in respect of the years 20102014, (iii) it was only reduced for 2015 because Dr Potamianos sought to argue that the amount should taper off to reflect the reduction in his actual time spent on software in 2015, but this would be irrelevant to a notional purchaser, who would be concerned to budget for the cost of a full time software engineer to ensure that SEL had the required knowledge to support and develop its software in the future. (6) Conversely, the cost of retaining Dr Fells is not a reliable guide. As Mr Prescott confirmed in oral evidence, Dr Fells was not employed by SEL, but was instead an independent contractor, and “his hourly rate is equivalent to £65,000”

“Dr Fells was engaged in a task that should not really have been necessary. All he was concentrating on was trying to restore the status quo with 6.13. He was not working on anything that could forward the fortunes of the company. He was just specially employed to try and recover that situation.”

“What I am trying to do is to arrive at a figure that would appear to be a reasonable amount of cash that the company could do without, could manage without, not to leave it with just the minimum that it needed to operate on a day-to-day basis, but to give it a buffer for a rainy day or some unexpected expense that it might need or some investment. My starting point was to look at the total level of administrative cost that it incurred and to calculate three months’ worth. I am not saying that is an agreed methodology or anything like that. It is just a guide to possibly arrive at a reasonable figure. Then I had a look at the amount of cash that was in the company over its history, which of course changed over time, as the company size changed over time. I looked at the proportions and I also looked at some accounts of other companies, other owner-managed businesses in the mechanical engineering sectors, and had a look at what levels of cash they maintained on their balance sheets. My initial conclusions came to a figure higher than the £450,000, but not by that much, and in discussion with Mr Stern, we agreed that the figure of £450,000 fell within the range that we both considered to be reasonable.”

“I think Ms Hindson made the comment about not cutting it to the bone, which I think is a valid point to make. And it comes back to the issue of what is the amount of surplus cash, how much should be retained in the business, in order to cover the eventualities, and one is looking at it from a valuation point of view. And on that basis, we have agreed £450,000.”

“Advertising and marketing costs – we agree that excess marketing costs of £78,635 relating to payments to Futuretech in FY17 should be added back to EBITDA. The figure of £78,635 represents the value of payments to Futuretech of £128,635 less annual costs of £50,000.”

“In particular, the experts agree that the following adjustments are to be applied: … iii. Adding back excess advertising costs incurred in the year ending 31 October 2017 in the amount of £78,635 …” 2017 in the amount of £78,635 …”

“Your clients’ failures … Breach of contract, negligence, director’s duty As a result of the issues detailed above your clients have breached:- 1. Clause 4.1 of the 1997 Contract because they have failed to use their best endeavours to develop our client’s business to its full potential in the most economic efficient and profitable way and in accordance with best business practice; 2. Clause 5 of the 2000 Contract because they have failed to undertake the Services in a professional manner at all times and have failed to undertake the Services in the capacity of a specialist; 3. Clause 7 of the 2000 Contract because they have failed to devote such time, attention, skill and ability as the Contract Works required; 4. Clause 2.1 of the 2015 Contract because they failed to provide Services with all proper skill and care; and 5. Their duties of care to our client because they failed to exercise the level of skill and care to be expected of a reasonably competent software programmer professing expertise in the field of digital motor controllers and in particular the software for such controllers. In addition 6. Dr Potamianos has acted in breach of his obligations as a director under the provisions of the Companies Act which we have identified above. He should have taken steps to correct the deficiencies and to warn our client of their existence. The losses suffered by our client as a result of your clients’ breaches … An estimate of our client’s claim Based on its review to date and subject to expert evidence in due course our client estimates that it will cost in the region of £468,000.00 … This estimate does not include making any improvements to the software … The above estimates are for coding only …”

“I believe that a due diligence process of SEL in September 2018 would in fact have revealed some very significant issues, as follows:- i) The PL/X and JL/X source code would only compile on an obsolete compiler. ii) There had been no development of the flagship product and it was losing ground to the competition. iii) The source code used in production had known bugs which would cause damaging problems in certain applications. SEL faced the risk of legal action from end users whose businesses had been affected by the bugs which SEL was unable to respond to. iv) SEL suffered reputational damage from selling faulty product. v) We were waiting for delivery up of the source code and all the documentation required to be able to use it and had no clarity about what would be delivered up. vi) The style of the code prevents it from being ported to a different microprocessor. This had already caused 7 years of delay and cost moving from the Intel to the Microchip processor. This situation could easily re-occur and a buyer would have the same problem. The only solution is a re-write from scratch in high level language - an enormous task. vii) [An issue concerning alleged source code provenance (“the provenance issue”)]. viii) SEL did not own the configuration tool used with the flagship product and needed to create its own. ix) The CE approvals on the flagship product were about to expire and the Electro Magnetic Compatibility approvals process needed repeating. This is an expensive and time-consuming task. x) SEL had been historically operating with a very lean workforce, which has flattered the profits. xi) The profile of SEL’s workface was aged and the older people were the ones with the historical experience in DC Drives. A new buyer was going to have to manage the retirement of this group and find replacements. xii) The machine used to test the PL/X flagship product in production was only supported by one person in his late 60s.The software that runs it is written in Pascal and the hardware is based around a 20-year old PC running on windows 98. This machine needs completely upgrading but it cannot be taken out of production. The only solution is to buy or make a completely new machine, which is a large cost liability with uncertain timescales. xiii) The product manuals had been neglected and all needed modernising. xiv) The business system was over 20 years old and consisted of different packages which didn’t all communicate with each other. It was designed by David Van Der Wee and when he left there was no one with that skillset in SEL. Will Pearson was given the task of sourcing a new system. The switchover was scheduled to be on 1 November 2018. Switching to a new business system is notorious for creating unexpected business casualties. xv) In an effort to mitigate the potential of not owning the source code SEL embarked on a 5 year R&D project to design a new product range. This is a significant liability for a potential purchaser. xvi) We also had the prospect of a damages case but as of 28 September 2018 had not assessed the level of damages, or the prospect of recovery. We knew that it would tie up cash to fund legal fees and would take a significant amount of management time.”

“Our client will contend at trial that the valuation of your client’s shares in [SRL] should be adjusted by £218,400.00 … for the following reasons … 7. Our client estimates that it will cost in the region of £468,000.00 … 8. This estimate does not include … It is assumed that this will take an engineer one man-year at a cost of £65,000.00. It is assumed that there will be overheads of 20% on that figure, totalling £13,000.00.”

“[Mr Prescott] contends that an adjustment should be made to the price of the shares of £218,400 or such other amount as the court sees fit to reflect a commercial negotiation. The risk of a windfall to [Mr Prescott] in the event SEL succeeded with a claim in respect of the quality of the source code can be avoided by an order for payment of a sum representing deferred consideration of 40% of the net recoveries of the claim.”

“Q. So as at the valuation date, Dr Fells was already engaged in working on the new compiler and the old compiler was irrelevant, was it not? A. Yes. By the time we received the code, Dr Fells had invested a lot of time in bringing 6.11 up to something that was useful so we decided to carry on with that rather than start afresh with 6.13. So, Dr Fells examined 6.13, found the changes, the differences in these parameters, and he is now trying to accommodate those in the work he has already done. Again, that seemed like the most sensible way of proceeding at the time. Q. Therefore, the old compiler was irrelevant on the valuation date, was it not? Q. Therefore, the old compiler was irrelevant on the valuation date, was it not? A. Yes, but the fact was that 6.13 would not compile on the new compiler.” (6) “Poor quality code that is hard to maintain”

“Based on its review to date and subjectto expert evidence in due course our client estimates that it will cost in the region of £468,000.00 to document and understand the software to a level where the software could be readily maintained/developed”